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Out-Law News 3 min. read

Unified Patent Court: UK to be a member during Brexit transition

The UK government has revealed that a deal was struck earlier this year to enable the UK to participate in the new Unified Patent Court (UPC) system during any Brexit implementation period that might apply.

The deal, between UK and EU27 Brexit negotiators, was agreed in March, but its relevance to the UPC was subtly referenced in a new guidance document for life sciences companies published on Monday.

The new UPC system, years in the planning but yet to become operational, foresees a Europe-wide court system to ensure that businesses have a streamlined process for enforcing patents through a single court where the patents are within the scope of the UPC – including new unitary patents. The UPC is to include central, regional and local divisional courts across Europe.

An international agreement, the UPC Agreement, was adopted in 2013 by 25 of the 28 EU member states. It provides for the creation of the UPC framework.

For the new UPC system to take effect, at least 13 EU countries, including the three with the most European patents in effect in 2012 – Germany, France and the UK, must pass national legislation to ratify the UPC Agreement. France and the UK have already done this along with 14 other countries, but Germany's ratification process has been held up by an ongoing legal challenge.

However, in addition to the case before Germany's Constitutional Court, Brexit also poses a risk to the future of the UPC project. This is because, as currently worded, the UPC Agreement only allows for participation in the UPC system by EU member states. The UK is scheduled to exit the EU on 29 March 2019.

Brexit negotiators for the UK and EU27 have been engaged in talks over the terms of a 'withdrawal agreement' to address what happens at the point of Brexit. An agreement on the terms of the agreement has not yet been reached, but earlier this year the negotiators reached provisional agreement on the terms of a Brexit implementation period. This would apply from the Brexit date until the end of December 2020 and is designed to give businesses in the UK and EU27 countries time to update their operations to account for the impact of Brexit.

On Monday, the UK government published new guidance on what the implementation period means for the life science sector. It included a reference relevant to the UPC.

"We … reached agreement with the EU at March European Council that the UK is to be treated as a [EU] Member State for the purposes of international agreements, including Mutual Recognition Agreements, for the duration of the implementation period," the guidance said. "The EU will notify other parties of this approach. This means that there will be no disruption to existing relationships underpinned by international agreements as we move into the implementation period."

Intellectual property law expert Alia Knight of Pinsent Masons, the law firm behind Out-Law.com, welcomed the announcement.

"Following ratification of the UPC Agreement by the UK on 26 April this year it is helpful to learn that, if the withdrawal agreement is finalised, the UK will remain part of the UPC during the implementation period," Knight said. "Hopefully, this will allow the UK to be part of the entry into force of the UPC Agreement and will give the UK and EU more time to negotiate the UK’s continued membership of the system."

In its guidance, the government confirmed that the UK's Medicines & Healthcare products
Regulatory Agency (MHRA) and Veterinary Medicines Directorate (VMD) would not have voting rights in the European Medicines Agency (EMA) and other EU committees during the implementation period, and would no longer act as leading authority to conduct assessments at the level of the EU or member states.

It further confirmed that the EU's new Clinical Trials Regulation and EU Medical Devices Regulation, which should be implemented during 2020, will be implemented in the UK.

The guidance also confirmed that it will be business as usual for the life sciences sector during the implementation period in respect of recognition in the UK and EU of UK batch release testing, Qualified Person certification, manufacturing and distribution licences, marketing authorisations via centralised and decentralised procedures, and CE marking.

However, Knight said that UK life sciences companies should note the EMA's guidance issued earlier this summer which contained advice on what holders of centrally authorised marketing authorisations should do to prepare for the UK becoming a 'third country' from 30th March 2019 in the event no withdrawal agreement is reached.

"Whilst the new guidance is a welcome and positive update from the government regarding the UK’s aim to overcome any uncertainty in the provision of medicinal products in the UK and the EU, this is all predicated on the finalisation of the withdrawal agreement prior to 29 March 2019," Knight said.

"The life sciences sector is likely to remain concerned that there seems to be little guidance in relation to the looming spectre of the UK crashing out of the EU with no agreement. The only certainty is that the UK will be leaving the EU on 30 March 2019. Life science companies should be planning for the worst case scenario," she said.

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